West Bengal Chief Minister Mamata Banerjee didn’t hold back her criticism of the Union government’s decision to cut Goods and Services Tax (GST) rates. On Monday, September 22, 2025, she asserted that these revised rates would directly cost the State exchequer a staggering ₹20,000 crore.
Her strong remarks coincided with the country’s adoption of a simplified two-tier GST system, where most goods and services are now taxed at 5% and 18%.
“The Central government isn’t spending a single paisa for this GST rate cut,” Ms. Banerjee stated. “All the money is coming from the State government’s coffers. Yet, one person is taking all the credit. Will he compensate us for this loss?” While she didn’t explicitly name Prime Minister Narendra Modi, her comments were widely understood to be directed at him.
The Chief Minister also announced that her government was preparing an advertisement to highlight this issue, which would be published soon. Speaking at a Durga Puja pandal inauguration in Kolkata, she acknowledged that while the rate cuts would benefit the public, the financial burden on West Bengal would be immense.
Ms. Banerjee highlighted that she was the first to advocate for reduced GST rates on health insurance. She further alleged that while the Union government would find ways to compensate states governed by the Bharatiya Janata Party (BJP), non-BJP ruled states like West Bengal would be left to suffer.
Earlier the same day, several BJP leaders, including West Bengal State BJP president Samik Bhattacharya, visited local markets to engage with shopkeepers and claim credit for the GST reductions. This political posturing added fuel to Ms. Banerjee’s fiery address.
Beyond the GST cuts, Ms. Banerjee also raised concerns about the Union government’s alleged failure to release over ₹1.92 lakh crore in Central project allocations for various schemes, including the Mahatma Gandhi National Rural Employment Guarantee Scheme. She lamented that this withholding of funds makes it challenging for West Bengal to sustain its own state-sponsored welfare initiatives like Lakshmir Bhandar and Krishak Bandhu.
Experts agree that the ₹20,000 crore revenue loss will place significant strain on West Bengal’s finances, especially given the state’s existing commitment to its cash incentive schemes. This fiscal challenge comes just months before the 2026 Assembly elections, where the Trinamool Congress government might be looking to introduce new welfare programs.
Trinamool Congress general secretary Abhishek Banerjee echoed his aunt’s sentiments, suggesting that the Union government was forced to reduce GST rates due to public pressure. He criticized the BJP’s approach to GST, tweeting, “BJP4India’s journey with GST has been a festival of exploitation. Higher the numbers of seats they have, higher the taxes. Lower their strength, lower the burden on the people. From 303 to 240 [seats in the Lok Sabha], the message resounds across India: defeat BJP, defeat their GST loot.”